REPUBLIKA.CO.ID, LONDON - A robust dollar swept to a 14-month high on Tuesday as investors tweaked bets on an early hike in US interest rates, burdening oil, gold and stocks in the energy majors. As the dollar broke to a six-year peak on the yen and a 14-month top against the euro, gold sagged to a three-month trough and Brent oil settled below the 100 USD a barrel mark.
Giving the dollar bulls encouragement was research from San Francisco Fed economists that showed investors are pricing in a lower trajectory for interest rates rises than members of the Fed itself are.
The dollar index .DXY, which benchmarks the greenback against six other major currencies, was up 0.25 percent, having climbed to a 14-month high of 84.519. A break above 84.753 would take it to highs not seen since July 2010.
"(The Fed report) has reinforced the stronger dollar trend that has been in place for the last couple months," said Lee Hardman, a currency strategist at Bank of Tokyo Mitsubishi in London.
"As we move forward we think we will increasingly see monetary policy diverge between the Fed and the other major central banks, and that is likely to be supportive for further gains against the euro and the yen."
Sterling, having seen its biggest fall in over 2-1/2 years on Monday, was steadier but stayed rooted at 10-month lows. A second opinion poll released overnight again showed a marked increase in support for Scottish independence just nine days before the country votes on whether to break away from the United Kingdom.
The TNS poll found support for the 'yes camp had risen six points to 38 percent, just a pip behind the 'No' vote at 39 percent. That followed a weekend YouGov poll showing approval of independence at 51 percent against the unity camp's 49 percent, the first this year to find a majority for a 'Yes' vote.